The Wasted Sunshine State

Florida gets lots of sunshine – it says so right there on our license plates. So when it comes to utilizing solar power, how come we’re getting beat by the likes of Massachusetts and New Jersey?

By:

Christiana Lilly

Published date:

Jun. 1, 2016

Florida's famous sunshine isn’t just a boon for tourists, but also for the energy sector. With so much sun beaming down, the solar industry has been keeping a close eye on Florida. In recent years though, industry experts haven’t always been impressed by what they’ve seen. When it comes to solar power, the Sunshine State lags behind other, cloudier places. Florida isn’t even ranked in the top 10 solar states, according to the Solar Energy Industries Association, a national solar trade association.

The association, made up of more than 800 companies across the country from manufacturers to solar power sales, believes it is because of state policy.

“Certainly Florida has a great solar resource and it probably should be doing better in terms of solar installations,” says Sean Gallagher, vice president of state affairs at SEIA. “One of the things that’s become clear over the past several years is the pace of solar installations depends heavily on the policies of the state.”

Nine of the 10 leading solar states, Gallagher explains, have “good state-level solar policy.” This includes issues such as third-party financing, renewable portfolio standards and tax abatements for solar. On August 30, Florida voters will get to vote on one of those issues. Amendment 4 offers tax breaks to industrial and commercial properties that use solar or renewable energy. (A similar abatement for residential property already exists in the state constitution.)

That issue has drawn widespread support. Other issues, revolving primarily around a consumer’s ability to buy energy through a provider other than a major utility such as Florida Power & Light, have proved more fraught. After the August vote, Floridians will get the chance to vote again on solar in November. But after a heated process that involved bickering between rival solar advocacy groups, the November ballot initiative will not include these alternate methods of paying for solar. In Florida, anybody can put solar panels on their home or business. But you still have to buy your power from your utility company.

New Jersey and Massachusetts, which receive far less sun than Florida, outrank the Sunshine State because of their third-party financing, which constitutes up to 90 percent of the market, Gallagher says.

“It’s a way for states to encourage their population to go solar and also to encourage heir utilities to buy solar and other renewable energies,” he says.

Florida is also one of just a handful of states in which only utilities are allowed to sell energy. Unlike more than half of U.S. states, Florida also does not have a renewable portfolio standard, which requires utilities to source a certain amount of energy from solar and other renewable sources.

That’s not to say the solar industry isn’t growing in Florida. Right now, more than 400 solar companies work in the state, giving jobs to 6,600 people.

One of these companies, Advanced Green Technologies, opened up shop in 2007 under its parent company, Advanced Roofing. “Even though there was not a large movement in the Southeast or the Northeast, we knew that it was coming. We knew that it was only a matter of time,” says Clint Sockman, vice president of the Fort Lauderdale-based company.

When the federal government extended tax credit for solar power users, the industry really took off. It also helps that installation and energy costs have decreased significantly over the last 10 years, cut in half in some cases. In 2014, the national average cost per kilowatt hour was 10.44 cents. Florida’s average is 10.77 cents, making it one of the more affordable states, according to the U.S. Energy Information Administration. Hawaii is an outlier at 33.43 cents while Washington is the cheapest at 7.13 cents. “As the technologies continue to decrease the cost, installation incentives continue to increase,” Sockman says. “What we’re seeing is more and more projects.”

Florida Power & Light has gotten into the act, opening its first solar farm, a 25-megawatt facility in De Soto, in 2009. Since then FP&L has opened several more centers and has a handful in the works.

However, even with sun and falling costs, Florida is not a solar leader. Several advocacy groups say they want to change that, but they differ on how.

Floridians for Solar Choice, a grassroots organization created by the Tennessee-based Southern Alliance for Clean Energy, started its campaign in January 2015. With the geographic size and energy potential of Florida, the group wanted to open up the market to third-party financing with a ballot amendment. It had support from Republicans and Democrats, as well as environmentalists and the business sector alike.

“Unfortunately, the large investor-owned utility monopolies like [Florida Power & Light], Duke Energy, and others have not invested the resources nor supported the policies to really have a significant market in Florida for solar power,” says Stephen Smith, executive director of SACE and a board member at Floridians for Solar Choice. “Florida ranks in the high teens in its actual deployment even though it should be in the top three or four in the country.”

Also in the race to make it on the ballot was Consumers for Smart Solar, formed a few months later. The group’s stated initiative was to promote solar power in a way that protected consumers - Screven Watson, a board member, says that the amendment guarantees in the state constitution individuals’ and businesses’ right to own solar panels. Floridians have that right today, but it is not constitutionally protected.

“There’s nothing that guarantees it,” Watson says. “This would give people the constitutional right to own solar energy and it really would prevent future policymakers or special interests from ever taking that away.”

While Floridians for Solar Choice is in favor of third-party leasing, Watson says Consumers for Smart Solar believes it can be bad for consumers, should they get locked into long-term leases with escalating prices year after year.

“It allows governmental bodies to still have oversight into consumer protection to make sure that people aren’t getting into bad leases and there aren’t fraudulent practices,” Watson says. “It’s open to any business model. We’re not prohibiting any business model, but it would have to be vetted.”

FP&L spokesperson Alys Daly says the company is in favor of the amendment going to voters in November because it protects the consumer.

“The thing that we loved about Consumers for Smart Solar is that it’s a way to advance solar energy in Florida … while protecting the rights of all Floridians,” she says. “If you looked at the other amendment, this amendment really strips out consumer protection because it didn’t allow for any regulation.”

Daly adds that while solar users give back to the grid which the company pays them for, they are also taking from the grid on rainy days. Even though they are connected to the grid, they are not customers, so their bills don’t pay for services like call centers and upkeep of the grid.

Watson says their amendment protects non-solar users from having to foot the bill for their solar neighbors.

Watson also makes the point that neighbors of solar users shouldn’t have to foot the bill when there are rainy days and their solar-using neighbor is taking from the grid rather than giving back.

SEIA disputes that, noting that “rooftop solar energy equals or exceeds the cost to the utilities of the reduced payments,” Gallagher says. Solar users produce the most energy and give back to the grid when it’s most expensive - during the day when it’s hotter and more people are using air conditioning. When they do use energy from the grid, it’s later in the day when it’s cooler, demand is low and prices are lower.

Through 2015 and the beginning of 2016, both groups campaigned, collected donations, and hit the streets to gather as many signatures for their petitions to get their amendments on the ballot.

Floridians for Solar Choice raised just over $2 million with more than $1.5 million attributed to donations through SACE. As a 501(c)(4), the group does not have to disclose its donors’ names and Smith says many donors wanted to donate privately to avoid backlash. The rest of the donations were given directly to the campaign -- $100,000 from Conservatives for Energy Freedom and the rest were small donations, most less than $100, from Florida residents.

“We consider protecting our donors against retaliation as a legitimate reason, but there are other times that people use dark money organizations and (c)(4)s to basically hide corporate interests. So we knew we were going to take some criticism there,” Smith says.

Consumers for Smart Solar was able to raise more than $7.5 million, thanks to large donations from Tampa Electric Company, Florida Power & Light, Duke Energy, Gulf Power Company, and Alabama’s PowerSouth Energy Cooperative. Other major donors included the 60 Plus Association, Florida Faith and Freedom Coalition, Let’s Preserve the American Dream and multiple chambers of commerce.

Of the utility companies donating to the campaign, Watson says, “I don’t work for the utility companies; I never have.

“I think that any time there is competition in the system, any time new energy sources come on, whether it’s wind or solar or whatever, energy utility companies want to make sure that they’re treated fairly,” he adds. “I don’t believe utility companies are trying to put solar people out of business. “That’s the main reason I got into this, to make sure consumers are protected, to make sure people aren’t being treated unfairly.”

The controversy of the race to the ballot also extended to the petition process. There were multiple reports of signature gatherers working for Consumers for Smart Solar, but misrepresenting themselves as someone from Floridians for Solar Choice - the latter group’s petition is a white piece of paper, while the former is green. Floridians for Solar Choice has a video of a man asking for signatures, saying yes, he is from Floridians for Solar Choice, as he hands the videographer a green piece of paper to be signed.

With three timesthe amount of donations, Consumers for Smart Solar was able to pay their signature gatherers more than those for Floridians for Solar Choice, $4 per signature as opposed to $2 per signature. Also, there were reports of some signature gatherers handing out both petitions to be signed - a reporter with the Orlando Weekly photographed one man doing just this.

“It defies all logic to suggest that we think confusing our amendment with theirs will help us get signatures,” Sarah Bascom, a spokeswoman for Consumers for Smart Solar, told the Miami Herald. “If that is happening, we want to know about it because we won’t tolerate it.”

Floridians for Solar Choice, unable to keep up and not collecting enough signatures, suspended its amendment efforts and has shifted its focus instead to the 2018 election - their signatures can be kept for up to 24 months. They are also promoting Amendment 4, the Aug. 30 Florida primary ballot item that offers tax breaks on solar.

SEIA is also in favor of the August ballot initiative. The November amendment, on the other hand, is “very deceptive,” Gallagher says. “It’s sponsored by the utilities, but they have tried to make it appear as if it is a customer, consumer-led effort,” he says. “It doesn’t make any changes in favor of customers or in favor of solar providers, it just makes it harder to change existing law in the future…it’s bad public policy and it’s deceptively promoted.”

After receiving enough signatures on the ballot, Consumers for Smart Solar’s amendment’s language had to be approved by the Florida Supreme Court. It passed 4-3.

“Let the pro-solar energy consumers beware,” Justice Barbara Pariente wrote in her dissent. “Masquerading as a pro-solar energy initiative, this proposed constitutional amendment, supported by some of Florida’s major investor-owned electric utility companies, actually seeks to constitutionalize the status quo … the ballot title is affirmatively misleading by its focus on ‘Solar Energy Choice,’ when no real choice exists for those who favor expansion of solar energy.”

When the amendment for Floridians for Solar Choice went through the court, it passed 6-1. Justice Ricky Polston was the lone dissenting vote and he wrote that the amendment “leads the voter to believe that this initiative is about someone who owns a small house or small business with a solar panel on the roof and wants to sell electricity on a small scale.

“However, according to the Florida Electric Cooperatives Association, a single local solar generating facility capable of generating two megawatts of electricity would span over 12 acres and could serve approximately 714 customers. The ballot summary does not provide notice to the voter that this proposed amendment provides for this scale of completely unregulated electricity generation.”

Sockman of Fort Lauderdale-based Advanced Green Technologies, which mostly works with commercial installations, is not taking a stance on the amendment battle, but he notes that Floridians have chosen to have their utilities publically regulated.

“You can’t have your cake and eat it too. You can’t have both – you can’t have a state that’s publicly regulated utilities and we want everyone to be able to sell power,” he says. “We really have no skin in that game. Our business model does not revolve around any one policy.”

Come August and November, Florida voters will have a chance to raise their voice about how they want the solar power industry to work in their state. While the various groups may not agree on policy, they do come to a consensus that solar is an issue that transcends political parties and ideology.

“Customers want solar,” Gallagher of SEIA says. “Utilities are going to have to find a way to give customers what the customers want.

“There’s hope for Florida, but it’s going to take some work.”

Is Solar Right For You?

Thinking about harnessing the power of the sun for your home? Here are some tips from the Solar Energy Industries Association before you take the big leap.

1. Identify your electricity usage

How much power do you currently use? Look at your most recent utility bill and find the kilowatt hours of usage (kWh) and how much you pay for it. Also, are you planning on any changes to your home, such as purchasing an electric vehicle or building an addition? This will help you determine the size of a solar power system that is suitable for you and your family.

2. Look at your roof.

What direction does your roof face? How old is your roof? Is it in good shape? Does it receive direct sunlight, or is it covered by shade from trees? All these things will matter when you install solar panels.

3. Research the solar companies.

Like with any major purchase, make sure you’re getting the best deal and that you’ll be well taken care of. Ask for references, compare costs, ask for a proof of licensure, and check that the company is in good standing with the county or state.

4. Understand the tax credits available to you.

Through 2019, there is a 30 percent federal tax credit available for owners of solar panels. Some states have programs for residents to lease solar panels, much like one would a car, and they would not be eligible. After 2019, the tax credit percentage will continuously drop to 26 percent in 2020 and 22 percent in 2021.

Confused by all the names and jargon in the Florida solar debate? Here’s a handy primer.

Third-party financing

Financing in which, through a traditional lease or a power purchase agreement, a customer leases solar equipment from a provider. With a PPA, a solar company installs a customer’s system at no cost. The solar company then sells power to the customer at a flat rate. Popular in many states, this method is currently not allowed in Florida, where only utility companies may sell energy.

Proponents view it as a way to offer consumers more choice while greatly expanding solar. Opponents view it largely as a consumer-protection issue.

Floridians for Solar Choice

Organization created by the Southern Alliance for Clean Energy that supports third-party sales. Its initiative received bipartisan support in Tallahassee, but not from big utilities such as Florida Power & Light. The initiative will not appear on November’s ballot.

Consumers for Smart Solar

Organization funded largely through donations from Florida Power & Light, Tampa Electric Company and other large utilities. It does not support third-party sales. Its initiative, which will be on the November ballot, would enshrine in the state constitution Floridians’ right to put solar panels on their homes. Floridians may already do this, but it is not guaranteed in the state constitution.

On the ballot

Florida voters will decide two separate solar-related items in 2016. On August 30 they will vote on Amendment 4. The constitutional amendment would offer tax breaks to commercial and industrial properties that install solar or renewable energy devices. (Something similar already exists for residential.) The amendment, which has bipartisan support, is supported by both Floridians for Solar Choice and Consumers for Smart Solar.

On Election Day, November 8, voters will decide on a proposed amendment that would enshrine in the state constitution the right to use solar. Consumers for Smart Solar backs this amendment as a way to prevent future policymakers from doing away with solar. Floridians for Solar Choice, which failed to get its own initiative allowing third-party financing onto the ballot, does not support the proposed amendment, saying it enshrines the status quo.